Steps in the Selling Process

Is it time for more space? Or a move due to a new job? No matter the reason, it can be an enjoyable time planning for your next home, but emotional as you remember all your current home has provided. Fortunately, Ruhl&Ruhl provides trusted real estate advisors and resources to help you with every step of the process.

Preparing My Home to Sell

The Buyer's Perspective

There are five things that buyers will consider when touring your home.

Location

Floor plan, amenities, features

Condition

Price

Size (lot and house)

Of these five considerations, you, the seller, can only control the condition and the price. These two items you will need to pay the most attention to as you prepare your home to be listed.

Your Home's Condition

The condition of a house is one of the most critical factors in selling a home. To evaluate your home's condition, you will want to review your property with “buyer's eyes.” Take a fresh look at your home, scrutinizing each aspect from curb appeal, to sizing up the interior as though you are seeing it for the first time.

Make a mental note of the things that might put off potential buyers, along with another list of the things that first attracted you to your home. Then start organizing. Clean out the clutter and put away all personal items. Your potential buyers need help imagining what it would be like to live in your house. You may think about staging your home, or hiring a professional home stager.

The next steps are to clean, clean and clean again. It can never be too neat or orderly. Also, make any and all repairs necessary to put your best foot forward. You can find approved, bonded and insured professionals to do any work through the Ruhl&Ruhl Home Services Program.
Homes that have new carpet, new kitchens, new appliances, new furnace, air or roof, etc will almost always sell faster. These features however, don’t necessarily add to the selling price. This is because most people are looking forward to some of these things in their new home.

Buyers are usually not concerned with the money a seller has spent on the house to maintain it or update it – regular maintenance and updating is expected by many buyers. To price a house based upon how much money you have spent on it or need to have, is a certain road to frustration.

In fact, the lesser the condition of a home, then the less the listing price must be lowered to compensate and make the house competitive. Peeling paint, dated plumbing fixtures or electrical fixtures, dated flooring or any wallpaper can each be detrimental to a quick sale.

Therefore, the best thing you can do starting right now is to fix or repair anything that is broken or worn out. As the saying goes, “new doesn’t make it worth more, but worn out will make it worth less.”

Lastly, never underestimate the front appearance when selling your home. You should exploit this as much as possible. The front appearance and yard should be inviting. Is the porch swept? Are the trees and bushes trimmed, and grass mowed? How about a flag or potted plants in front? This is the first place the buyers will judge whether or not they want to see more.

Pricing My Home to Sell

Compelling Pricing

In order to determine an appropriate price for your home, your Realtor will complete a Comparative Market Analysis (CMA) to understand the property's condition, compare it to the market and set an accurate price. Setting the right price before you list is critical to getting the most for your home and selling it quickly.

Having a professional with experience in your neighborhood to prepare a CMA gives you the facts and insight to set the right price. Although a CMA is not a true real estate appraisal, your Realtor uses the same methodology as an appraiser to determine where your house fits into the current real estate climate.

Two rules to follow in real estate appraising are

pick “like” homes – the same features, year built, similar styles, and size, and

pick homes in the same general area that have recently sold within the past six months.

Of course homes are never identical and adjustments must be made by giving value to certain features or subtracting for what is lacking. The integrity of the data rests on how close the comparable sales are to your house.

In comparing “like” homes, your Realtor will recommend a list price that is attractive to a buyer, but more importantly, in line with recent comparable sales, which is the price that real buyers are currently paying for similar homes. Be careful not to base your value on the asking price of other homes currently for sale. These are only asking prices, which likely will not be what they end up selling for.

The goal is to find a list price that makes a buyer want to make an offer NOW. If the price is too high, even a beautiful, lovely home can become “old news” and we may also have to adjust the price during the process to actually get it sold. I recommend that we pick a list price very near what we think the sales price will be to avoid the “price reduced” stigma.

On average your home will be among 10-20 homes that buyers will compare and contrast. To be picked first, your house must be perceived to be the best value. YOU control how fast your house sells when you pick the listing price.

Fear of Overpricing

Buyers should hear the listing price and become excited at the prospect of owning your home for what they perceive to be a “good’ price. A good price is what a buyer thinks it should be.

A list price that is very close to that “good” price will bring a quick offer. And a quick offer means less negotiating for the seller! The longer a house stalls on the market without an offer, the more likely a buyer will “low ball” and the more negotiation is required.

The National Association of Realtors (NAR) has studied the relationship of the list prices vs. sale prices nationwide. NAR stats show that a house which is just 5% overpriced can increase the time spent on market by as much as 50%!

Subsequently, overpriced homes often must be reduced 3-5% every 60 days until a buyer makes an offer. And each time there is a price reduction, it’s like starting from scratch with a new crop of buyers and resetting the clock. Overpricing results in a lower sale price and it most certainly increases the time it takes to sell than if the house had started at a competitive price.

The Road to Closing

Disclosures

One of the most important documents you will fill out as a seller is the Seller’s Disclosure. This is a form that a seller must give a buyer, which details all physical problems and defects that the seller is aware of. You must be honest and as complete as possible when filling out this document. And only you, the seller, may fill it out. It's a big crime for sellers to fail to disclose any problems they're aware of.

First Steps in Marketing Your Home

Now it's time for marketing! Your Realtor should have presented a detailed marketing plan before you agreed to list with them. They will use that as their guide as they begin to market your property. Some of these tactics occur at the same time, right up front.

You can expect photos to be taken of the property as soon as it's cleared of clutter and personal items, staged and cleaned. Photos are the most reviewed item on a real estate website and can greatly impact the marketing and ultimately the sale of your home.

Your Realtor may recommend getting professional photographs taken, or even shoot videos to help showcase special features of your home or the neighborhood. Ruhl&Ruhl takes your property photos and turns them into a video to help bring more attention to your property.

At this time, a sign will be placed in your yard and the listing for your home will be placed on the Multiple Listing Service (MLS). In fact, Ruhl&Ruhl is a member of 10! Your Realtor may do additional marketing, for example, on websites like RuhlHomes.com, which has over 1 million visits a year, or Realtor.com, or through mailings or email campaigns.

Your Realtor will also share the property with other sales associates within our company to help find appropriate and approved buyers. They do this through weekly sales meetings, private Facebook groups with other Ruhl&Ruhl sales associates, email, and Realtor Tour, which invites sales associates into your home so they can provide feedback on the price, condition and features.

Please make sure if there are any fixtures, anything permanently attached to the land or the structure on the property, like ceiling lights, window shades, and curtains, that you would like to keep, you inform your Realtor. They will make a note of that on the MLS documents and may even put a note on the actual fixture.

Open Houses

Your Realtor may encourage you to allow them to host an open house. Open houses may occur at all different times and days of the week. They allow many different sets of eyes to view your home to see if it’s a good fit. Often, visitors at open houses are near the beginning of their home search, but it’s not out of the question to expect a visitor through an open house to end up making an offer.

To prepare for an open house, your Realtor will advertise. They may put additional signage up, promoting the time of the open house. They may send out mailings and may even place an advertisement in the newspaper, depending on the market and type of home.

You will want to make sure your home is clean, doors are easily accessible (walks are swept or shoveled), and that it smells fresh and clean. Your Realtor also may have you turn on all the lights and open blinds or curtains, so it’s bright and well-lit. You also will be asked to take any pets with you during the open house.

Showings

Before you receive an offer, you will have requests for showings. This requires you to leave the home for a period of time, while a buyer's agent takes their clients through your home. Some buyers will see the home several times before making an offer.

During showings you will want to prepare the home similarly as you have for an open house. Turn on lights, open blinds or curtains, make sure surfaces are clean and decluttered, and ensure that the home smells clean and fresh. Again, you will want to take any pets out of your home.

We understand showings and open houses sometimes aren’t easy and it can be difficult to keep your home clean during the listing process, but it will all be worth it when you receive an acceptable offer.

You’ve received an offer – now what?

Advanced negotiation skills are a great asset. Combining advanced negotiation skills with detailed facts and specific real estate expertise achieve the maximum result. Ruhl&Ruhl has a specialized program to teach and certify our full-service agents for real estate negotiations that deliver for our clients.

Once an offer is made, your sales associate will take you step-by-step through the offer and what each section means. For example:

What was the offer price?

What contingencies have been requested?

When do they want to close and how will they be paying - financing or cash?

What inspections have been requested and who is paying for them?

What fixtures are being requested?

You may seek recommendations from your Realtor, but ultimately you will make the decisions. Then, your Realtor will go to work negotiating the offer with the buyer's agent and potential buyer. A professional Ruhl&Ruhl sales associate is key to negotiating the terms and conditions specified in the purchase contract. As the seller, you may choose to accept terms, reject the offer or present a counter offer.

What will you net?

It’s important to consider your goals when accepting, rejecting or countering an offer. Your Realtor will provide what is often referred to as a net sheet. This is a worksheet that factors in closing costs, taxes, realtor fees, inspections you’ve paid for, as well as repairs that will come out of the proceeds, which provides a sum that you will net after the sale of your home. Depending on the offer, this could be a high number or a negative number. If it’s a negative number, you will be bringing a check to closing.

Accepted Offer!

Now that you have an accepted offer, you need to locate your abstract as soon as possible. In order insure that you have good title to your home, an abstract of title is prepared from the records of the county where the real estate is located. The abstract covers not only the time during which you have held title, but prior owners as well. For an older home, your abstract can be very large, even hundreds of pages. Most lenders will require that the abstract be continued and title opinion rendered before they will make a loan.

You will need to get your abstract to your attorney so they can examine and report any liens, encumbrances, covenants, easements, right-of-ways, and other matters which may affect the buyer’s purchase.

Inspections & Negotiations of Repairs

Once you have come to terms on the offer and both parties have signed the agreement, the buyer’s agent will schedule the inspections that were agreed to. Most will have a whole house inspection with radon. A whole house inspection is an overview of your entire home. Radon measures the level of radon gas in the basement level of your home. It’s the buyer’s right to be present during these inspections. Once the inspection results are received, your agent will receive a repair addendum, which is a request for additional inspections or specific repairs the buyers would like you to complete. For example, the whole house inspection may show that the inspector couldn’t get an adequate look at the roof, so the buyer may request the opportunity to pay for their own roof inspection.

The repair addendum is another opportunity for your Realtor to negotiate on your behalf. Again, another reason to have a Realtor trained with advanced negotiation skills and real estate expertise. You may choose to negotiate only those items not able to be seen by the buyer or you may choose to repair all items requested by the buyer to keep the transaction moving forward.

You may consider reviewing the Ruhl Approved Vendor List for vendors who are licensed, bonded, and insured, to complete any repairs at your home.

Appraisal & Next Steps

Once the repairs are completed, your lender will order an appraisal. A real estate appraisal is the process of developing an opinion of value for real property at market value. Your lender requires an appraisal because real estate transactions occur infrequently and each property is so unique. Once the appraisal is complete you will hear from your lender as your final loan commitment. They will also discuss with you your closing date and time.

You will want to make sure you secure home insurance. The Nelson Brothers Agency is an insurance agency affiliated with Ruhl&Ruhl Realtors. Click here to receive a free insurance quote.

After you have your closing date from your lender, you will want to contact and reserve any moving companies. Often these need to be secured a few weeks before closing. Click here to see a list of local moving companies.

Closing

The buyer of your home will do a “final walk through” with their Realtor a couple days prior to closing. They will double check that any repairs promised have been completed and look that no fixtures are missing from the home. They also may note anything that they didn’t see before, now that furniture is often moved.

Fixtures and Loose Ends

A fixture is anything permanently attached to the land or the structure on the property. For example, ceiling lights, awnings, window shades, and doorknobs are fixtures. In general, anything you have to use a tool to remove from your home is considered a fixture and should be sold with the home unless otherwise discussed. You will want to take care to ensure that fixtures stay with the home and if there are any lights or curtains, for example, that you would like to take with you, that you discuss that with your Realtor during time of the listing contract.

You will want to start notifying utility companies for your new home so they can be prepared to transfer the utilities to your name. This also ensures that the buyer has notified the utility companies that they will be moving to your old home. This includes gas/electric, water, trash collection, tv, internet, and phone. Click here to see our utility guide.

You will also want to notify the post office of your change of address. In addition, start contacting your banks, credit cards and other institutions that will be mailing bills. You may even consider updating your driver’s license after closing.

Closing

The final step is closing the transaction. A closing takes place at an attorney's office, title company of your choice, your lender’s office, or even sometimes at a real estate office. When all the applicable paperwork has been signed - and there’s a lot for the buyer to sign - the keys are handed over to the buyer.

Please make sure you or your Realtor bring all keys and garage door openers to closing.

The buyer has 48 hours after closing to notify us of any issues in the home. Real estate contracts containing no repair contingencies may free sellers from post sale-closing liability except in cases of possible fraud, when disclosures are intentionally false. However, fraud or liability of home sellers for post-sale repairs is normally best handled by attorneys.

Current Real Estate Trends

Should I Sell?

When you begin the process of selling your home, you should first consider your goals, your timeline and the current market conditions. First, think about why you would like to sell.

What do you hope to gain?

What are your fears?

Where do you plan to live once you sell your home?

Are you already pre-approved to purchase another home?

Who will be involved in the home selling process?

Take some time to think through these questions and put your answers to paper. It's important to understand what you hope to achieve so you can easily share that with your Realtor, once you interview and hire them.

Is NOW the time?

Next, you need to consider your specific timeline. The home selling process can take anywhere from 45-180 days. It takes 45 days on average to close on your home sale after an accepted offer. On average, it can take 30-60 days to obtain an accepted offer. This is another reason that it's important to compellingly price your home so that you can meet your timeline. It also is very important to understand when you would like to move so you can work backwards into an ideal timeframe.

If you choose the right listing price, you should be able to get an offer within 60-90 days. Once a buyer makes a valid offer, it then takes 30-45 more days to close the sale. There’s the inspection period, the appraisal by the lender, the abstracting by the attorney, etc. Therefore, if you have the right list price, the average time from listing to closing could be anywhere from 3-4 months.

Understand that the sale price relates directly to the length of time on the market - the further above “fair market” the asking price, the longer it takes to sell.

What is the market like?

Lastly, you will want to consider the area's current housing market condition. Ask your Realtor how many months of inventory there are in your area or neighborhood. Months of inventory is a good way to measure supply and demand, which will impact how your home is priced.

Months of inventory reflects an estimate of the amount of time it would take to sell all of the current listings in a given area if no new listings became available.

Less than three months of inventory: Seller's Market
Homes may be higher priced or sell faster because there is not enough supply to keep up with the demand. This can create a competitive market for that specific area, housing niche, or price range, causing homes to have multiple offers within the first day, or even offers over the asking price.

Three to six months of inventory: Neutral Market
The supply is keeping up with the demand.

More than six months of inventory: Buyer's Market
Homes are selling more slowly or there are lots of homes to choose from. In a buyer's market, buyers have more negotiating power than sellers because the supply of listings exceeds the current demand for housing.

Feeling overwhelmed already? Don't be! Choose a Realtor to help you start the process. A Ruhl&Ruhl sales associate will sit down with you and your family to walk you through these seller questions and help identify your goals. This will be the baseline for everything moving forward. Choose a Realtor that will listen, give sound advice, and that you work well with. They will not only help you start the process, but will be your guide throughout.

Selecting the Right Realtor

Going it Alone?

Hiring a professional to help your sell your house is an easy decision for many. They understand the importance of having an advocate who understands the market, law and paperwork, has the time for marketing, showings, negotiations and inspections, and also has been specially trained to handle any issues that may come up. There are some people that would like to 'go it alone', but we would encourage you to at least interview some Realtors to see how they would work for you.

Here are some additional things to familiarize yourself about the process of selling your home. If you choose to sell your home by yourself, you will want to understand these terms very well:

FHA vs VA Financing

Disclosures

Radon

Purchase Agreement

Hiring Your Perfect Team

Behind every successful manager is a great team. In the game of real estate, you are the manager and you need to ensure you have the best team to help you reach your goals. It is the job of our Realtors to walk you through the process of selling a home efficiently, effectively and with as few issues as possible. But if and when an issue does arise, it's their job to offer solutions. In fact, this is what they are specially trained to do. You will always make the decisions, but your Realtor and the rest of the team will manage the process.

In every transaction there may be a few fears – fear of not getting an offer or not getting an acceptable offer, for example. This is the same in selling a home. It's the job of your first team member, your Realtor, to help you identify the right listing price and make sure they are addressing any of your fears. They are specially trained to support you through this process and will be your guide from start to finish. They are your counselor, your advocate, and are the person looking out for you and your interests. They have a fiduciary duty, or a legal responsibility, to act solely in your interest. You always stay the manager, but they will be the lead team member to get you home.

A Realtor brings a wealth of knowledge and experience to the business of selling a home. In fact, a licensed real estate professional provides much more than the service of finding an appropriate buyer. Realtors are not just sales agents. They are expert negotiators, seasoned financial advisors, and superb navigators around the local neighborhood. They are members of the National Association of Realtors (NAR) and must abide by a Code of Ethics and Standards of Practice enforced by the NAR.

Your Realtor will consult with you to get a handle on what your wants and needs and they will ask the right questions to direct you through the process. They will give advice to get your home ready for market, market your home, make appointments to show your home, host open houses, negotiate offers with your direction and much more. A professional Realtor is your best resource when selling your home.

When hiring a Realtor, don't do so based upon family relations, pricing, commission rate, or friendship. Decide who you believe in your mind is the most qualified to get the job done. A Realtor should be chosen for their expertise in guiding you through the home selling maze of paperwork, negotiations, and “what if” scenarios. Choose the person who has access to the proper tools.

What to look for in a Realtor?

This will be a close partnership and the best Realtor is one who has the necessary knowledge, acts honestly, and gives you terrific service from beginning to end. Here are some things to look for in an agent:

Someone who is dedicated to their profession

Someone who takes time to determine your needs

Someone who listens – and responds to your requests

Someone who is familiar with the area in which your home is located

Someone who will be willing to work with you until your needs are fulfilled

Someone who is a full-time agent

Someone who is willing to share references

Your Realtor is your lead team member, but you will also select a lender, a real estate attorney, insurance provider, and different inspectors. Your entire team handles the process on your behalf, working to ensure it goes the way that you expect. They are always in your corner representing your interests.

How Realtors are Paid

Ruhl&Ruhl Realtors doesn’t collect any money until there is a closing. When the house closes the brokerage company will collect a fee, typically a percentage of the total sales price on the offer.
The brokerage company then gives a portion of that fee to the buyer’s agent’s company for bringing us the buyer. This is how we “hire” Realtors from all other companies to show and sell our listings.

The real estate companies then split their percentage with their agents and if a relocation company is involved, they’ll take an additional referral fee. On the listing side, all marketing dollars are paid up front by your Realtor throughout the listing period. There are no hidden extra costs.

Keep in mind that your Realtor will be paid nothing if there is no sale or closing. Realtors are all independent contractors and do not collect any salary or hourly wage from our company. Therefore, since Realtors are only paid if YOU receive results, they have a tremendous motivation to get your house sold. Ruhl&Ruhl sales associates will do everything they can to market your home to other Realtors and the buying public in order to get the house sold within your time frame. They also work to ensure that there are no surprises or loose ends that could foul up the sale once you get that buyer.

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